Ideate

Advertise during the downturn

by Fred Roed on 18/05/09 at 3:43 pm
5 comments

Part of my job* is to discuss marketing budgets with managers of small, mid and large size companies. This has been particularly insightful over the past 6 months since the recession really put the skids on certain sectors of the economy. Interestingly, it has also started to reveal people’s characters in a more lucid way than before, when things were all rosy and nice.

The question that people are asking is “Should I advertise in a downturn?” The ambitious managers see massive opportunity here and are jumping into hyperdrive; conservative managers are digging their heels in and succumbing to the easy, yet shortsighted, temptation to slash marketing budget.

There are some lessons here for small business too.

An ad agency friend of mine sent me a document entitled ‘Don’t Stop Advertising’ (sorry, it’s not Creative Commons so I can’t upload it), but it did hold some interesting points. The basic highlights are as follows:

• If you have got cash, increase marketing spend, don’t decrease it – this is a surefire way to increase your market share.
• Consumer behaviour changes during a downturn, which also provides opportunities e.g. consumers buy cheaper items that make them feel better about themselves, e.g. Estee Lauder reported in the 2001 recession healthy sales of lipstick (an instant fix of cheer for many women).
• When you stop brand advertising, the effects are not immediately visible, but the damage will certainly be felt when the economy swings up again.
• Recessions don’t last forever, and they sometimes provide once-in-a-lifetime opportunities, e.g. to leap-frog your competitor.

In the article there was also 5 points to watch the bottom line by a guy called Bill Gibson (on the right, with the staggeringly awesome hairdo). It’s worthwhile reading:

1. Focus on family values (people tend to spend more time with families in a recession)
2. Don’t cut, downsize if you have to (try to maintain frequency of advertising by downsizing costs of ad placement, e.g. radio instead of TV, smaller print ads, direct marketing instead of traditional media)
3. Target your advertising (quality instead of quantity, try spend less targeting relevant people instead of mass marketing)
4. Get creative (find ways to stay in your customers minds)
5. Revisit your prices (people are cost-conscious in a recession)

One more point to add, in a bit of shameless self promotion, you’d do well to try alternative methods of advertising, like, for example, placing your brand on a channel like Ideate ** (or other blogs and social media portals). Blogs provide cost-effective, targeted channels to dedicated and loyal communities.

*I’m the CEO of a digital marketing company.
**Email me if want to know how to go about advertising on Ideate.

Fred Roed is the marketing guy in the Ideate crew. Fred is the CEO of web marketing company World Wide Creative and the co-founder of online learning portal Heavy Chef. Fred loves writing about people out there doing marketing right. Follow Fred on Twitter here. View more articles by Fred Roed.

Tags: advertising, recession

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